CFTC asks Sixth Circuit to block Ohio from regulating Kalshi

The Commodity Futures Trading Commission filed an amicus brief in the Sixth Circuit on Tuesday asking the court to bar Ohio regulators from treating Kalshi’s sports event contracts as unlicensed sports gambling. The brief argues the state exceeded its authority and that the CFTC has exclusive jurisdiction over event contracts traded on designated contract markets.

Ohio ordered Kalshi last year to stop offering sports event contracts in the state. Kalshi sued state officials in October and asked a federal court for an injunction. A district court denied that request in March, and Kalshi appealed to the Sixth Circuit.

In its brief, the CFTC asked the appeals court to overturn the district court decision and to prevent the Ohio Casino Control Commission and the state attorney general from enforcing state law against Kalshi’s event contracts. The agency said state regulation of event contracts on DCMs would interfere with federal oversight of swaps and binary options.

The brief accused Ohio of “jurisdictional overreach,” arguing that permitting state limits on sports event contracts could put the Commission’s authority over other event contracts at risk. The filing notes Congress and the CFTC have long regulated event contracts that trade on designated contract markets.

CFTC Chairman Mike Selig commented on the filing, stating the federal district court applied an improperly narrow view of the agency’s jurisdiction and reiterating that the CFTC will not allow overzealous state governments to undermine the agency’s longstanding authority over these markets.

The filing is part of a wider set of legal actions. In April, the CFTC sued Wisconsin to stop state lawsuits against prediction markets after state regulators issued cease-and-desist letters or other enforcement actions. Those state actions targeted multiple platforms that operate as CFTC-regulated designated contract markets, including Kalshi, Polymarket, Crypto.com, Robinhood and Coinbase.

Kalshi’s appeal asks the Sixth Circuit to block Ohio officials from taking action against its sports event contracts. The outcome of this appeal and related cases will determine whether states may regulate prediction markets or whether the CFTC’s authority over event contracts traded on DCMs remains exclusive.